Professor Lyman P.Q. Johnson is a nationally known scholar, whose work focuses on business associations, securities regulations, corporate finance, and business planning. His scholarship has been cited by judges, in their own scholarly writings, presentations, and in judicial decisions, including in In re Walt Disney Company Derivative Litigation, 2005 WL 2056651 (Del. Ch. Aug. 9, 2005), where two of his articles on fiduciary duties were cited. In addition, his article on the business judgment rule was voted by American corporate law professors to be one of the “Top 10” corporate and securities law articles in the country for the year 2005.
This lecture revisits two fundamental issues in corporate law. One involves a great deal of seemingly settled law—the central role of the business judgment rule in fiduciary litigation—while the other—whether there is a mandated corporate purpose—has very little law. Using the emergent question of whether the business judgment rule should be used in analyzing officer and controlling shareholder fiduciary duties, Professor Johnson will propose a rethinking of the rule’s analytical preeminence. For a variety of reasons, he suggests elevating duties themselves to be more prominent and deemphasizing the business judgment rule.
As to corporate purpose, Professor Johnson will advocate that Delaware law permit a pluralistic approach in the for-profit corporate sector. Long agnostic about ultimate corporate objective, Delaware law may have turned unnecessarily toward a strict shareholder primacy focus in the 2010 eBay decision. To bring clarification and to foster flexibility, Professor Johnson recommends a legislative default provision, with an opt-out feature.