Fellow BLPB blogers have shared on and off line their coverage scope and strategies for Business Associations/Corporations.  In thinking about how to fit in big corporate constitutional questions into a syllabus that is already jam packed with topics, this 2013 article (Teaching Citizens United v. FEC in the Introductory Business Associations Course) by Michael Guttentag at Loyola Los Angeles, provides some great suggestions.  Written in a post-Citizens United and pre-Hobby Lobby era, I think his insights are broadly applicable about how corporate constitutional rights illustrate the “costs that may arise from differences between manager interests and shareholder interests, the costs that may arise from following a shareholder primacy norm, and the distinctive nature of the role of the transactional lawyer.”  This short (8 pages) article is worth reading to identify some opportunities to discuss these important issues in a way that illustrates difficult concepts within your existing syllabus and hopefully keep students engaged throughout the semester.  

-Anne Tucker

At West Virginia University College of Law, we started classes yesterday, and I taught my first classes of the year: Energy Law in the morning and Business Organizations in the afternoon.  As I  do with a new year coming, I updated and revised my Business Organizations course for the fall.  Last year, I moved over to using Unicorporated Business Entities, of which I am a co-author.  I have my own corporations materials that I use to supplement the book so that I cover the full scope of agency, partnerships, LLCs, and corporations.  So far, it’s worked  pretty well.  I spent several  years with  Klein, Ramseyer and Bainbridge’s Business Associations, Cases and Materials on Agency, Partnerships, and Corporations (KRB), which is a great casebook, in its own right.

I did not make the change merely (or even mostly) because I am a co-author. I made the change because I like the structure we use in our book. I had been trying to work with KRB in my structure, but this book is designed to teach in with the organization I prefer, which is more topical than entity by entity.  I’ll note that a little while ago, my co-blogger Steve Bradford asked, “Are We Teaching Business Associations Backwards?” Steve Bainbridge said, “No.” He explained, 

I’ve tried that approach twice. Once, when I was very young, using photocopied materials I cut and pasted from casebook drafts the authors kindly allowed me to use. Once by jumping around Klein, Ramseyer, and Bainbridge. Both times it was a disaster. Students found it very confusing (and boy did my evaluations show it!). It actually took more time than the entity by entity approach, because I ended up having to do a lot of review (e.g., “you’ll remember from 2 weeks ago when we discussed LLCs most recently that ….”). There actually isn’t all that much topic overlap. Among corporations, for example, you’ve got the business judgment rule, derivative suits, “duty” of good faith, executive compensation, the special rules for close corporations, proxies, and so on, most of which either don’t apply to LLCs etc…. or don’t deserve duplicative treatment.

I have great respect for Prof. Bainbridge, and his writing has influenced me greatly, but (not surprisingly), I come out more closely aligned with my perception of Larry Ribstein on such issues, and with Jeff Lipshaw, who commented, 

I disagree about the lack of topic overlap, and suspect Larry Ribstein is raging about this in BA Heaven right now. . . .

This may reflect differences among student populations, but the traditional corporate law course, focusing primarily on public corporations, is less pertinent in many schools where students are unlikely to be doing that kind of work when they graduate. It’s far more likely that they’ll need to be able to explain to a client why the appropriate business form is a corporation or an LLC, and what the topical differences between them are.

I completely agree, and I would go another step to say that I find the duplication to be a valuable reinforcement mechanism that is worth (what I have seen as limited) extra time.  I am teaching a 4-credit course, though, which gives me time I never had in my prior institution’s 3-credit version. 

One thing I am doing differently this year is my first assignment, which seeks to build on what I see as a need for students here. That is, I think many of them will need to be able to explain entity differences and help clients select the right option. 

I had my students fill out the form for a West Virginia Limited Liability Company (PDF here). I had a few goals.  First, I don’t like to have students leave any of my classes without handling at least some of the forms or other documents they are likely to encounter in practice.  Second, I did it without any instruction this time (I have used similar forms later in the course) because I thought it would help me tee up an introduction to all this issues I want them thinking about with regard to entity choice.  (It did.) Finally, I like getting students to see the connection between the form and the statute. We can link though and see why the form requires certain issues, discuss waivable and nonwaivable provisions, and talk about things like entity purpose, freedom of contract, and the limits of limited liability.  

If nothing else, the change kept things fresh for me.  I welcome any comments and suggestions on any of this, and I wish everyone a great new academic year.  

OK.  So, I am stretching a bit here.  But yoga may be considered a sport, athletic clothing is a kind of fashion, and securities fraud prohibitions and corporate director fiduciary duty involve law.  So, I stand by my blog title in the face of any criticism that may follow this post.

I do yoga four times a week when I am not traveling.  I also work out, sometimes on days when I am not doing yoga.  So, I have a fair number of pieces of yoga wear and other athletic clothing.  This means that I get regular mail and email solicitations from the firms that purvey these clothing items.

I recently received a catalog from one of my favorite athletic clothing brands, Sweaty Betty, which I discovered originally when I was teaching in Cambridge, England in one of our study abroad programs a few years ago.  I noticed, with some amusement, that the new catalog harps on the opacity of the firm’s yoga bottoms or trousers (as the British like to call them).  The website does the same–“100% opaque” labels abound.  As an astute consumer and securities lawyer, I immediately jumped to the conclusion, whether right or wrong, that this yoga-bottoms advertising campaign is a reaction to the see-through yoga pants debacle of one of Sweaty Betty’s competitors, Lululemon (another of my favorite brands).

What does business law have to do with this (apart from the many standard legal angles on the recall of products generally)?  As my securities regulation students from last spring well know (since it was the subject of part of their final exam), stockholders of Lululemon brought a securities fraud class action suit against Lululemon, after the recall of the see-through pants, based on alleged misrepresentations of material fact in public disclosures touting the high quality of its yoga pants.  Predictably (at least imho), the District Court dismissed the action back in April.  The court’s opinion and order resulted in a few interesting online law firm commentaries with colorful titles (including posts from, e.g., Orrick and Weil).  The public fallout also includes (as most would guess) allegations of breaches of fiduciary duty and observations about insider trading and Rule 10b5-1 plans because of some well-timed trades by Lululemon’s founder and then-CEO. 

As we think about the new semester (ours starts on Wednesday), the Sweaty Betty catalog reminded me to bring the Lululemon matter to the attention of our law faculty readers.  The facts and public reactions make for a nice case study of risk management in the context of securities regulation and fiduciary duty law.  A Stanford “Closer Look” piece, as well as many news reports, make the use of the case reasonably easy.  And for those of you who want to take a peak at my exam question, just ask . . . .

I have read about the economic boom in North Dakota. The state has the highest economic growth rate and the lowest unemployment rate in the nation, primarily due to energy production using hydraulic fracking. But I didn’t really appreciate the statistics until I recently had an opportunity to see what that boom looks like “on the ground.”

Last week, my wife and I went to western North Dakota, the heart of the fracking industry, to backpack in Theodore Roosevelt National Park. When we weren’t backpacking, we got a chance to see the North Dakota economy first-hand. What we saw amazed us:

  • Motels in remote places like Dickinson and Watford City charging more than $200 a night. Not four-star hotels. Chains like AmericInn and La Quinta. And these are not prime tourist locations. Look for Watford City on a map; it’s in the middle of nowhere. (No disrespect intended to any North Dakota readers, but you have to admit that, but for the fracking boom, Watford City is not prime real estate.)
  • Temporary housing everywhere. One reason the hotel rates were high is that many of them are housing workers on a permanent basis. There is a serious housing shortage. We saw literally dozens of mobile home encampments, and apartment rents have skyrocketed.
  • Jobs begging for workers. Almost every business we visited had some sort of “jobs available” sign. We saw a sign at one hotel offering bonuses of $500 to $1000 for housekeepers.
  • Immigration. Not surprisingly, the low unemployment rate, the relatively high pay, and the available jobs have drawn people from outside the state. Many of the people we talked to were not natives and their time in the state was typically measured in months, and sometimes just weeks.
  • Construction everywhere—motels, apartment complexes, grocery stores, strip malls, and roads.
  • Thriving businesses. We visited a large grocery store in Watford City, a small town of a few thousand people. Although we were there at early afternoon on a Monday, we were surprised to see every check stand open, with three or four carts lined up for each checker. We asked a local why the store was so busy on a weekday afternoon and he told us it was always that busy.
  • Traffic, traffic, traffic. Because of the boom, the infrastructure has not always kept up with the economy. The roads in western North Dakota were packed with oil trucks, pickups, and almost every kind of business vehicle imaginable. At one rural highway intersection in the middle of the fracking area, we waited almost 20 minutes to get through the light.

It’s one thing to read about the boom; it’s another thing entirely to see it.

I don’t know what the effect of all this has been on business lawyers in North Dakota, but my guess is their practices are booming. Someone has to draft all the leases and employment contracts, and at least some of that work is being done within the state. And I suspect there’s a big boom for criminal lawyers as well. As one local told us, there’s a lot of testosterone (most of the oil workers are male) and a lot of liquor, and that’s not a good combination.

This year, I’m going to be teaching a seminar on the financial crisis with a friend of mine from law school, Tanya Marsh of Wake Forest.  The seminar will be offered at Wake Forest in the Fall and then again at Duke in the Spring.  Among other things, we plan to assign the students to watch several movies about the crisis (some will be watched by the entire class; for others, different groups of students will watch different films, and then discuss them with the class).

In preparation, I watched (or, as the case may be, rewatched) the movies we’re likely to assign.  So here are my comments on the movies – which I assume many of you have already seen, but probably not everyone has seen everything – with the caveat that, I’m commenting at least as much as an audience member/amateur film critic as I am as a professor.

(Tanya tells me the students are unlikely to stumble across this post, but in case you do – these are my opinions only, we’ll want to hear yours!  And for what it’s worth, Tanya and I disagree on at least one of the films.)

[More under the jump]

Continue Reading Saturday Movie Blogging

I have updated our Business Law Professors on Twitter List with some professors I met at the ALSB conference last week.

Tweets from the recent professor additions to the list are below. 

 

Over at PrawfsBlawg, on a post comparing the SEALS and AALS conferences, an anonymous commenter questioned the value of academic conferences.

In this economic environment, many schools are tightening their belts.  A number of schools have made cuts to funds for travel and professional development. 

Below, I list some of the areas in which conferences can provide benefits. 

Teaching.  At most conferences I attend, I attend at least one panel on pedagogy.  In addition, many of the panels provide new material for classes.  Also, fellow professors may be more willing to share teaching materials, which can be invaluable, if they have met you in person at a conference.

Service.  Conferences are often the hub for discipline-related service.  Many, if not most, of my external service opportunities have come from other professors I met at conferences.

Research.  You can receive excellent comments on your papers at conferences and are much more likely to get other professors to review your work if you have met them in person.  Also, a number of the people who have cited my work are people I met at conferences.  

Professional Development.  Much of our time as professors is spent with students, who are usually not experts in our subject areas.  Even most of our colleagues are not experts in our specific research areas.  Conferences give professors a chance to test themselves against other experts in their areas, which can lead to significant professional development.

Inspiration.  I tend to return from conferences inspired and refreshed.  Seeing the successes of my colleagues at other schools encourages me to be more efficient and improve in all areas. 

Community.  Academic community often grows from conferences. Blogs, social media, listservs, e-mail, and phone calls can sustain the community, but I think it is relatively difficult to be truly plugged into the broader academic community without at least a few in-person meetings with other professors. 

Compensation.  Frankly, I count funding for conferences as part of my compensation.  A school without funding for conferences would likely have to pay more in salary if it did not provide funding for conferences. Also, payment for conferences usually amounts to a relatively small portion of total faculty compensation.  

Rankings. Many school rankings depend, at least in part, on peer reputation.  In the U.S. News law school rankings, for example, peer reputation is actually the single most heavily weighted factor.  I don’t think schools should chase rankings just for the sake of the rankings, but improving rankings can impact things that matter (recruiting intelligent students, attracting recruiters to campus, and making (generous) alums happy, etc.)  I’m not sure how much schools spend on those glossy brochures they send to other schools, chasing peer reputation, but I am much more likely to think well of another school if I hear a good presentation from one of their faculty members than if I see an impressive looking pamphlet in my mailbox. 

Of course, there are probably ways to cut spending on academic conferences without losing the above benefits and I am open to those ideas.  

Related to this post, I am interested in how other schools divvy up travel funds (and any details about your school’s approach to travel funds that you can share).  At Belmont, we apply to our assigned associate dean to get funding for any conference we wish to attend. Except in the most rare circumstances, you will not get funding if you are not presenting a paper.  I am not sure what the limits for travel funding are at Belmont, but they have been generous in granting my requests so far.  I know some schools grant professors a set amount of travel funds each year; this seems like a good way to encourage careful spending and allow better planning by professors, but it does not address the variation in professor productivity (unless the amount granted is pegged to recent publications).

THE CENTER FOR LAW, ECONOMICS & FINANCE (C-LEAF)

AT

THE GEORGE WASHINGTON UNIVERSITY LAW SCHOOL

 

Fifth Annual JUNIOR FACULTY BUSINESS AND FINANCIAL LAW WORKSHOP

AND JUNIOR FACULTY SCHOLARSHIP PRIZES

 

Sponsored by Schulte Roth & Zabel LLP

CALL FOR PAPERS

The Center for Law, Economics & Finance (C-LEAF) at The George Washington University Law School is pleased to announce its fifth annual Junior Faculty Business and Financial Law Workshop and Junior Faculty Scholarship Prizes.  The Workshop and Prizes are sponsored by Schulte Roth & Zabel LLP. The Workshop will be held on February 27-28, 2015 at GW Law School in Washington, DC.

The Workshop supports and recognizes the work of young legal scholars in accounting, banking, bankruptcy, corporations, economics, finance and securities, while promoting interaction among them and selected senior faculty and practitioners. By providing a forum for the exchange of creative ideas in these areas, C-LEAF also aims to encourage new and innovative scholarship.

Approximately ten papers will be chosen from those submitted for presentation at the Workshop pursuant to this Call for Papers. At the Workshop, one or more senior scholars and practitioners will comment on each paper, followed by a general discussion of each paper among all participants. The Workshop audience will include invited young scholars, faculty from GW’s Law School and Business School, faculty from other institutions, practitioners, and invited guests.

At the conclusion of the Workshop, three papers will be selected to receive Junior Faculty Scholarship Prizes of $3,000, $2,000, and $1,000, respectively.  All prize winners will be invited to become Fellows of C-LEAF. C-LEAF makes no publication commitment. 

Junior scholars who have not yet received tenure, but have held a full-time academic appointment for less than seven years as of the submission date, are cordially invited to submit summaries or drafts of their papers.  Although published work is not eligible for submission, submissions may include work that has been accepted for publication. C-LEAF will cover hotel and meal expenses of all selected presenters.

Schulte Roth & Zabel LLP, one of the leading law firms serving the financial services industry and known for its premier practice in the area of private investment funds and private equity M&A, generously sponsors the Junior Faculty Scholarship Workshop and Prizes and provides other financial assistance to C-LEAF.

Those interested in presenting a paper at the Workshop should submit an abstract, summary or draft, preferably by e-mail, on or before October 17, 2014. To facilitate blind review, your name and other identifying information should be redacted from your paper submission.  Direct your submission, along with any inquiries related to the Workshop, to:

 

Professor Lisa M. Fairfax

Leroy Sorenson Merrifield Research Professor of Law

George Washington University Law School

2000 H Street, NW

Washington, DC 20052

lfairfax@law.gwu.edu

 

Papers and Junior Faculty Scholarship Prizes will be selected after a blind review by members of the C-LEAF Executive Board. Authors of accepted papers will be notified by November 24, 2014.

A brief ten-question survey is one of the most effective tools I have used in my three years as an academic. I first used one when teaching professional responsibility and then used it for my employment law, corporate governance seminar, and business associations courses. I’m using it for the first time with my civil procedure students. I count class participation in all of my classes for a portion of their grade, and responding to the survey link by the first day of class is their first “A” or first “F” of the semester.

I use survey monkey but other services would work as well. The survey serves a number of uses. First, I will get an idea of how many students actually read my emails before next Tuesday’s first day of class—interestingly as of Thursday morning, 62% of my incoming 1Ls have completed their survey, while 42% of the BA students have done theirs. Second, my BA students work in mini law firms for a number of drafting exercises and simulations. The students can pick their own firms, but I designate a “financial expert” to each firm based upon the survey responses. I remind them that they should never leave the classroom thinking they are “experts” in the real world– they are just experts compared to the “terrified.” I use this tactic to avoid having all of the MBAs and bitcoin owners (yes, I had some last year) sit together and unintentionally intimidate the other firms with their perceived advantage.

Third, I get an idea of how students have learned about business prior to BA and what news sources they use. Fourth, I tailor my remarks and hypotheticals (when appropriate) to reach the litigators or those who plan to specialize in nontransactional work. I want them to know how BA will relate to the practice areas they think they will enter. I tell them on the first day that I went to Columbia for college because it didn’t have a math requirement and I planned to do public interest work, went to law school because the LSAT was the only graduate school entrance exam that had no math on it (ok- my professor Jack Greenberg at Columbia also said I should go). I tell them that I became a litigator to avoid business and spent my first years as a non-corporate person having to learn about FASB and the definition of a “security” because I was a big-firm commercial litigator. I tell them that when I went in-house I had to take accounting for lawyers and although I don’t love the accounting, we will discuss some basics because they never know where they will end up. Many of them mat even represent entrepreneurs. My first day speech is meant to reach the 79% of my students (as of this morning) who say they want to be litigators.

Finally, I feel as though I’m not walking in on the first day completely ignorant of my students. I often use the names or storylines from popular shows or movies in class when I can. The show Suits, by the way, is the runaway favorite for my 1Ls and I know my BA students watch it as well. My BA survey questions are below. If you are interested in seeing my Civ Pro questions, email me at mnarine@stu.edu.

1. Please enter your first and last name. If your name is hard to pronounce, please provide a phonetic spelling as well (rhymes with ___ or NUH-RHINE for Narine). 

2. Have you had any experience working in a legal setting (firm, court, agency, clinic, other) BEFORE coming to law school or DURING law school? Please answer yes or no and then describe the experience if you answered “yes”.

 a) Yes- please complete comment box

 b) No

Other (please specify) 

3. Which type of practice appeals to you more?

 a) Planning (e.g. transactional)

 b) Dispute resolution (e.g. litigation)

 c) I do not plan to practice law after graduation

Other (please specify) 

4. Have you or a close family member ever owned a business?

 Yes, and I have been completely involved in management and/or business discussions

 Yes, and I have been somewhat or occasionally involved in management and/or business discussions

 Yes, but I have had no involvement in management and/or business discussions

 No

5. Do you own any stocks, bonds, other types of securities (individually or through a mutual fund or trust) or bitcoin?

 Yes

 No

6. Choose up to THREE fields of law in which you would most prefer to practice

 a) bankruptcy

 b) civil rights/constitutional law

 c) corporate and securities law (including business planning)

 d) criminal law (prosecution)

 e) criminal law (defense)

 f) labor and employment law

 g) trusts and estates

 h) family law

 i) health law

 j) immigration

 k) intellectual property

 l) real estate/land use

 m) litigation (plaintiff side)

 n) litigation (defense side)

 o) sports and entertainment

 p) tax

 q) other, please describe

Other (please specify) 

7. Do you have an MBA, business, finance, accounting, or economics degree?

Yes

No

8. Do you read any business related newspapers, magazines or blogs? Do you watch any business-related television shows or listen to podcasts or radio shows? If so, please name them.

9. Other than to pass the class, what are your learning goals for this course? Are there particular topics that interest or frighten you?

10. Please describe your level of familiarity with business, finance and/or accounting.

 I am an expert and could teach this class

 I have some experience, but could use a refresher

 I have no experience, but am willing to learn

 I am completely terrified

My goals this year: help my students think like business people so that they can add value, help them pass the bar, and most important, help them realize that business isn’t so terrifying. Now I just have to get my Civ Pro students to realize that the show Franklin and Bash is probably not the best way to learn about legal practice.