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Article
Demise of the Director's Duty of Care: Judicial Avoidance of Standards and Sanctions Through the Business Judgment Rule
UF Law Faculty Publications
  • Stuart R. Cohn, University of Florida Levin College of Law
Document Type
Article
Publication Date
12-1-1983
Abstract
Courts love the so-called business judgment rule. It dispenses quickly and easily with derivative actions against corporate directors and officers, and other challenges to corporate conduct. Unfortunately, the business judgment rule has come to mask its underlying premise, i.e. that there must have been a business judgment made. This article examines the dominance of the business judgment rule over the underlying requirement of the duty of care and suggests reform measures that will bring the duty of care back to its appropriate role in determining the merits of management decision-making processes.
Citation Information
Stuart R. Cohn, Demise of the Director's Duty of Care: Judicial Avoidance of Standards and Sanctions Through the Business Judgment Rule, 62 Tex. L. Rev. 591 (1983), available at http://scholarship.law.ufl.edu/facultypub/427