Academic

Chander on Bainbridge on Chander on Non-Controlling Shareholders

By Lawrence Solum

Anupam Chander (University of California, Davis - School of Law) has posted Corporate Law's Distributive Design (Yale Law Journal Pocket Part, Forthcoming) on SSRN. Here is the abstract:

I respond to Steve Bainbridge?s critique of my 2005 Yale Law Journal essay, Minorities, Shareholder and Otherwise. My essay made two novel claims: that corporate law places protection of minority shareholders at the heart of its endeavor; and that this minority-mindfulness should have even greater purchase in constitutional contexts. In his new paper, Bainbridge challenges my account of corporate law?s solicitude for minority shareholders, suggesting that corporate law does not practice affirmative action for minority shareholders.

I rebut Bainbridge?s case analysis, demonstrating that the cases show clear judicial succor for minority (by which I mean non-controlling) shareholders. The overarching explanation for judicial action in corporate law matters can generally be found in the simple goal of protecting minority shareholders. Unlike current constitutional jurisprudence, then, corporate law does not embrace minority-blindness. Because of, or despite, a legal framework attentive to the most vulnerable among those contributing capital, corporations have proven to be remarkably successful forms of enterprise. Ultimately, I hope to spur the thought that human organizational forms stand to learn much from each other.

Full post as published by Legal Theory Blog on June 16, 2009 (boomark / email).