Shareholder Rights: Citizens United and Delaware Corporate Governance Law

Paul S. Miller — Wed, 28 Mar 2012 11:03:05 PDT

This paper asks whether there might be alternative grounds for limiting corporate political expenditures. This alternative ground argument has two components. First, the conflict in corporate campaign finance cases should be seen as a conflict between two equally important first amendment rights: the right to receive information and the right to associated only with political positions one agrees with. Second, the corporate governance scheme advanced Citizens United as the alternative to state protection of shareholder association rights would undercut long standing Delaware Corporate Law. Under Citizens United, the outside forces that are viewed as the biggest threat to shareholder wealth would have a new weapon in their arsenal.

The article begins by analyzing the main Constitutional paradigm that drives this debate: that liberties are being taken away in the name of equality. I conclude that this conflict can only be resolved politically, not legally. It then demonstrates that Citizens United cannot be a decision based on legal principles such as stare decisis and judicial restraint, absolute free speech rights, or property rights. It then presents the conflict between Citizens United's corporate democracy theory and current Delaware corporate governance law. The article concludes with a suggested litigation path for determining whether my conclusions are correct.

Congress, Corporate Boards, and Oversight: A Private Law / Public Law Comparison

Paul S. Miller — Tue, 24 Mar 2009 11:29:48 PDT

This article argues that a system of congressional oversight based on trust can produce more effective government than one based on highly detailed regulations. The article first presents historic examples of congressional oversight and the ways in which trust contributed both to the effectiveness of the oversight and to the success of the policies at issue. The article goes on to examine the rise of trust theory in corporate governance as a means of making oversight by boards of directors more effective and thereby making corporations more profitable. The final part of the article explores how use of trust theory in corporate governance can be applied to civil governance.