The given case highlights the unethical practice of the president WG towards the organization U as follows:
• He was utilizing the position and the organization's resources so as to build his own rival organization
• Even though he has justifications which highlight the guaranteed revenue for the organization U, it cannot be considered as the valid justification since the organization ended up with losses in the end
• He and his family members were trying to convert the employees of U to join their company, which is considered to be the potential loss in terms of resources
• This practice has certainly harmed the business operations of the U and Mr. GW is liable for this, due to misutilization of his designator powers
• It has completely affected the operational cycle of the organization, in turn the profits and progressive growth of the organization
A) The director's fiduciary duty to a corporation is not discharge just by stating he has a conflict of interest. His actions should harm the corporation in order to discharge him/her from fiduciary duty. Therefore, this statement is incorrect.
b) Director also owes fiduciary duty to a corporation. Therefore, this statement is incorrect.
c) It is assumed the promoter owes fiduciary duty to the corporation to be formed. Therefore, this statement is incorrect.
d) A majority shareholder would be in control of a corporation and thus would have fiduciary duty to act in best business interest of the corporation. Therefore, this statement is correct.
Refer to the case State v Christy Pontiac-GMC, Inc. to answer question as below:
Facts to this case
• A company forged an application to receive cash rebates for the company.
• The cash rebates were meant for the company's customers.
• The state attorney general brought a suit against the company.
The issue is whether corporations (which are not natural persons) can be held liable for crimes with specific intent.
Relevant Terms, Laws, and Cases
Specific Intent Crimes - is knowingly or intentionally committing a crime.
Analysis and Conclusion
Note that corporations can be held liable for criminal charges. For examples, see criminal cases against certain companies during the 2008 financial crisis. However, the defendant's argument is that companies can't intentionally commit a crime because they are not natural persons.
It doesn't matter whether the corporation is a real person or not as there were numerous cases where corporation are guilty with crimes dealing with specific intent. Citation of proofs required to show the corporation is guilty of a specific intent crime are
• An agent of a company acted in a criminal manner within the scope of his employment.
• The criminal action furthered the company's business interest.
• And these actions were "authorized, tolerated, or ratified" by the management.
These three conditions are met because i) fraud (criminal act) was used by the company's employee to obtain rebates for ii) the company (benefit to company) and iii) some of the management signed for these rebates (ratification or toleration). Thus, there was sufficient proof for specific intent crime by the corporation.
There is no answer for this question