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U.S. Supreme Court To Address Executive Compensation Issue

By Francis G. X. Pileggi, Esq.

The U.S. Supreme Court has accepted an appeal from a decision of the U.S. Court of Appeals for the 7th Circuit on an executive compensation issue. More specifically, the opinion appealed from addressed the fiduciary duties of advisors to mutual funds based on federal statutes, as well as compensation payable to those advisors. Here was a prior post I did on the appeal, with citations to the opinions appealed from and a link to the actual opinion of Judge Easterbrook and the dissent of Judge Posner. The dissent was written in a manner that some have suggested was designed to increase the odds of SCOTUS review.

Though the executive compensation issue being considered is in the context of a federal statute governing mutual funds, many nationally recognized corporate law experts have provided scholarly commentary on the appeal and its potential impact on corporate governance in general, as well as fiduciary duties, though the law professors debating the issue disagree about the scope of impact that any SCOTUS decision will have on corporate law generally.

The luminaries who have provided learned insights on the issues involved include Professor Ribstein, here, Professor Bainbridge, here,  and Professor  Birdthistle, here (the latter providing multiple links to original sources and additional commentary by other scholars on the issues involved.) Oral argument in the case is scheduled before the High Court for November 2.

Full post as published by Delaware Corporate and Commercial Litigation Blog on August 19, 2009 (boomark / email).