Assignment:
Law Business and Society Corporations and Society
The purpose of problem set is to encourage you to reflect upon our discussions regarding corporations in American society, their function, legal status, and role, and by extension, the role of professionals within them. These questions are broad, and you are encouraged to explore the ideas raised by them. There are not "correct" answers per se, just more or less thoughtful (and informed) answers. Each answer should be 3-4 pages (double spaced, 1 inch margins) in length.
Choose any 5 of the following 7 questions:
1. We often hear talk of corporations as "persons" under the law. What does this mean, practically, and how has it evolved over time from Chief Justice John Marshall, writing in the Dartmouth College v Woodward opinion, to Associate Justice Anthony Kennedy? What kind of person is the corporation, and why is this important? Specifically, how has the personhood of corporations been changed by the recent Supreme Court decisions of Citizens United and Hobby Lobby? Please cite from these three opinions to make your points. Lastly, do you believe corporations should be granted the properties they now possess due to Citizens United and Hobby Lobby?
2. From the standpoint of society, why might it make sense to allow farmers to organize into a growers' cooperative (eg, Ocean Spray, Land O' Lakes, Organic Valley) even though - arguably - such as organization constitutes a contract "in restraint of trade," which would be a violation of the Sherman Antitrust Act? Use examples and concepts from economics to support your argument.
3. From a business/tax and risk/return standpoint, what are the major differences between a for-profit "corporation" and a "partnership"? What sorts of issues do these differences raise for society? With these ideas in mind, please explain why society would require that public auditing firms to be partnerships (or more recently LLP's), and why managemeent consulting firms also tend to be LLP's though not required by law.
4. What is the relationship between the "business judgment rule" and "fiduciary duty," and please explain how - taken together - they provide a description of the legal relationship between executives and owners of a corporation. Can the law really create a role - the fiduciary - in which the executive acts as a "reasonably prudent owner" would act? Use examples to illustrate your points.
5. A) In terms of Ownership/Governance, how does a Not-For-Profit firm differ from all the other firms we have discussed in LBS? Please be specific and reasonably complete. Then consider, what sorts of businesses are best performed by not-for-profits, as opposed to for-profit firms? Why is that so? Give examples to illustrate your ideas. B) Do you believe the U S Supreme Court should have made a distinction between for-profit and not-for-profit firms in Citizens United and/or Hobby Lobby? Why or why not?
6. How does a Benefit or B-Corporation differ from a standard for-profit C-Corporation? Why might a business choose to operate as a B instead of a C. Give an example of a business that might benefit from being a B-Corp, and explain explicitly and convincingly why the B charter might be better.
7. Apply to concepts of the course, and specifically our discussions about the constitution, criminal justice, corporations and government, to the following article:
How the American government slowly became a business by Jon Michaels
Do you agree with Professor Michaels' analysis? Use course concepts to support your position.