I. The Swerve to the Right … A. The Vetting of Substantive Content from Corporate Statutes ... B. The Rationale: Reliance On Fiduciary Duty ... C. Gutting Fiduciary Duty: The Committee on Corporate Laws's Subchapter F and Directors' "Conflicting Interest Transactions" ... 1. Origin of Fairness as the Talisman ... 2. Rationale for "Reform" ... 3. Model Act Chapter 8, Subchapter F—Gutting the Duty of Loyalty ... D. Demise of the Duty of Care ... E. The Ultimate Death of the Derivative Action: The Committee on Corporate Laws Universal Demand Requirement ... 1. The Advent of the Special Litigation Committee Device ... 2. Zapata and a Partial Retreat by State Supreme Courts ... 3. The True Death Knell for the Derivative Action—Background of the Committee on Corporate Laws' Subchapter D ... 4. Gutting the Derivative Action—The Committee on Corporate Laws at Work ... 5. The Outcome—An Absence of Significant Legal Control Over Corporate Managers' Conduct in Model Act Jurisdictions
II. Reasons Why: Motivation of the Committee on Corporate Laws ... A. Too Many Rose-Colored Glasses ... B. Utilization of a Fortune 500 Corporate Model Not Suited for Model Act Jurisdictions ... C. Influence of the Law and Economics Branch of the Corporate Law Academy ... D. Cutting the American Law Institute "Off at the Pass"
III. Corporate Law's Future: Evasion of the RMBCA Straightjacket ... A. Judicial Avoidance ... 1. Precedent for Judicial Avoidance ... 2. Anticipation of Judicial Nullification in ABA Commentary ... 3. Grounds for Judicial Avoidance ... B. Characterization of Wrongdoing as Affirmative Misconduct ... C. Use of Expanded Versions of the Corporate Opportunity Doctrine ... D. Attacks within the Statutory Framework—Faults in the Process of Disinterested Director Approval ... 1. Disclosure Defects ... 2. Lack of Due Care ... 3. Duty of Loyalty Attacks ... E. Proceeding in a Direct Rather Than Derivative Action
Douglas M. Branson,
Recent Changes to the Model Business Corporation Act: Death Knells for Main Street Corporation Law,
72 Neb. L. Rev.
Available at: https://digitalcommons.unl.edu/nlr/vol72/iss1/7