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CALIFORNIA CORPORATE & SECURITIES LAW

Is There A “Revlon Duty” In California?

There are certain seminal Delaware corporate law cases that are so well known that corporate lawyers are wont to assume that they have been adopted and followed everywhere.  One such case is Revlon, Inc. v. MacAndrews & Forbes Holdings, Inc., 506 A.2d 173 (1986).  In that case, the Delaware Supreme Court famously proclaimed that once…

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The Most Important Principles of Delaware Corporate Law Can’t Be Found In the DGCL

I have often observed that you can read every section of the Delaware General Corporation Law and learn almost nothing about Delaware corporate law.  Here are three of the most fundamental principles of Delaware corporate law that you won’t find in the DGCL: The business judgment rule.  This venerable presumption is derived from, but not stated…

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Another Federal Judge Spurns Application Of The Business Judgment Rule To Officers

Last week, I covered the choice of law issue in FDIC v. Faigin, 2013 U.S. Dist. LEXIS 94899 (C.D. Cal. July 8, 2013) and promised more, When The Parent Is A Blue Hen And The Subsidiary Is A 49er, What Law Governs? Faigin is one of many cases brought by the Federal Deposit Insurance Corporation against officers and directors of…

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True Or False? Golden Parachutes Benefit Shareholders

Golden parachute arrangements are often included in discussions of anti-takeover devices.  For example, the late Harold Marsh, Jr. in his magnum opus, Marsh’s California Corporation Law, discusses golden parachutes in a section entitled “Defenses of Control”.  Can it be that golden parachutes actually have the opposite effect?  A recent study by Professor Eliezer Fich, Ahn Tran, and Ralph Walkling…

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