How Broad Should the "Business Judgment" Rule Be in Protecting
How broad should the "business judgment" rule be in protecting officers and directors from liability for their actions? What is the purpose of the rule? What are the difficulties in its application?
Why did proponents of the Sarbanes-Oxley Act believe that the Act was needed,and will it result in more accurate reporting of financial results?
Several recent college graduates perfect a new beer that uses large amounts of garlic in the brewing process.They form a corporation called Garlicbrew,Incorporated to produce and market this beer.Nance buys one hundred shares of the ten thousand shares in Garlicbrew's initial public offering.Nance wants access to corporate records in order to learn more about the company so she can be a more informed shareholder.She also wants to learn as much about Garlicbrew as she can,because she is considering starting a company to develop and market a beer that uses onions in the brewing process.The corporate officers refuse to let Nance have access to any records of the corporation.Can Nance force the officers to allow her access to the corporate records?
Stableblades,Incorporated holds a patent on an inline skate that differs from others on the market in that it has two rows of wheels.These skates are not quite as fast as regular inline skates,but are much more stable,and are designed for older persons and persons who skate only occasionally.Mary is a shareholder of Stableblades.Stableblades has been selling this product for several years,and there are no similar products on the market.Twice in the past few years,Stableblades has threatened litigation over patent infringement,ands its legal assertiveness prevented many competitors from introducing similar products.Recently,however,another competitor actually introduced a similar product that Mary believes infringes on Stableblades' patent.Mary has tried to get the Stableblades Board of Directors to take action,but it refuses to do so.Mary suspects that some of the board members would like to be elected to the competitor's board of,and this is the reason for their inaction.Explain Mary's options in this situation,and whether the actions of the board would be protected.