CORPORATIONS SYLLABUS

Prof. Cunningham
Spring 2016
Description. This four-credit course provides students with a basic understanding
of the law that governs business corporations. Specific topics include: the internal affairs
doctrine and litigation rules, organization and authority, control, capitalization, leverage,
limited liability, dividends, fiduciary duties, control transactions, derivative litigation, and
indemnification.
Materials. The required casebook is CORPORATIONS AND OTHER BUSINESS
ORGANIZATIONS: CASES, MATERIALS, PROBLEMS by Linda O. Smiddy & Lawrence A.
Cunningham (8th ed. 2014). Supplements to the casebook are also assigned and can be
accessed on the portal ahead of the related class under the file Supplemental
Materials (and they are so referred to on the accompanying list of assignments).
We will study statutory selections from two principal sources, the Delaware General
Corporation Law (DGCL) and the Model Business Corporation Act (MBCA). Links to the
full text of both appear on the course web site (via the GW portal); my excerpts of the
most relevant selections are posted on the portal in two formats: each statute in numerical
sequence as they appear and the two statutes side-by-side in substantially the order they
arise in our course. (But note that many sections make multiple appearances, so this
sequencing, and that listed on the syllabus, should not be adhered to rigidly.) Throughout
the semester, additional material, such as PowerPoint slides, may be posted on the course
web site.
Meetings. Class meetings are January 5, 2016 through April 7, 2016 on Tuesday
and Thursday, 9:55 a.m. to 11:55 a.m. We will take a mid-meeting break during each
session. Classes may not be taped or recorded except by the Office of Instructional
Technology (formerly called the Media Center) in accordance with Law School policy.
Student use of any electronic equipment during class is prohibited, with the exception of
devices being used to store materials and/or take notes related to the class.
Seating. A seating chart will be completed in the first few days of class, and
students must sit in elected seats during all subsequent classes. Some back rows of the
classroom will be out-of-boundsplease choose seats as close to the front as possible.
Attendance and Participation. Students are required to attend class and be prepared
to contribute to discussion. Voluntary participation is welcome and outstanding cumulative
contributions by the top fifteen percent or so of students will be recognized by increases in
final grades of one increment. Mandatory participation will be implemented by an
alphabetical on-call system, working through the roster from A to Z day-by-day. Students
who are unprepared on their assigned days will be ineligible to receive grade increases
from voluntary participation and be ineligible to receive any periodic opportunities for
extra credit that may occur during the semester.

Extra Credit and Evaluations. Besides extra points for voluntary class participation
as noted above, there may be periodic opportunities to obtain extra credit through
various exercises such as corporate law contests announced in class. Beyond that, grades
will be based on the final examination administered at the end of the semester. The
examination is multiple-choice and open-book. A set of sample questions and answers will
be posted on the course web site. If you strongly disfavor multiple choice exams, do not
take this course.
Assignments. The assignments follow, organized by class meeting. We should be
able to adhere to the schedule closely, though some variation may arise due to current
events and/or class discussion. Pacing in the earlier half of the course may also warrant
adjustments to the assignment list during the latter half of the course. Any such
adjustments will be reported in class and referenced on a supplemental assignment listed
posted on the course web site.
Additional Optional Reading. WARREN E. BUFFETT & LAWRENCE A. CUNNINGHAM,
THE ESSAYS OF WARREN BUFFETT: LESSONS FOR CORPORATE AMERICA (advanced
materials, written in accessible format, containing famed investor Warren Buffetts letters
to shareholders of Berkshire Hathaway, assembled by Prof. Cunningham); WILLIAM A.
KLEIN & JOHN C. COFFEE, JR., BUSINESS ORGANIZATION AND FINANCE (Foundation Press)
(intermediate level materials providing theory and policy from economic perspective);
ALAN R. PALMITER, CORPORATIONS: EXAMPLES AND EXPLANATIONS (West Group)
(elementary level introduction to basics of corporate law from doctrinal perspective with
illustrations).
Office Hours. My office is Stuart Hall 408. My office hours are Tuesday and
Thursday 2:30 to 3:30. You can send me an e-mail, lacunningham@law.gwu.edu, seeking
an appointment at other times or meet via Skype: lawrence.cunningham.9. You can also
pose queries by e- mail concerning the class and please note that I will share email
correspondence (on an anonymous basis) with the entire class when doing so would benefit
the entire class. I also Tweet about relevant topics so you might wish to follow:
@CunninghamProf on Twitter.

No.
1

As background before the course, read the following casebook pages:

17-22 (skim); 139-145; 152-154 (skim); 218-227
Date
Topic / Cases
Casebook
MBCA
DGCL
Incorporation / Internal Affairs 231-246
2.02(a), (b)(1)-(3) 102(a)(1) & (4)
1/5
218-227
Vantagepont
3.01(a)-3.02
102(b)(1) & (4)
121(a)

1/7

1/12

1/14

Corporate Litigation Rules

Boilermakers Local,
ATP Tour, Inc.

102(f), 109(b)
115

Supplemental
Materials (on portal)

Organization
Roach, Datapoint,
Paulek, Jones

309-323

Shareholder Authority
Gashwiler, Seinfeld

325-331
332-346

(skim 303-09)

[skip MMI]
[skip 3 p. 333]
[skip 3 p. 335]

2.05-2.06(a)-(b)
7.04(a)-(b)
8.01; 10.20
7.01-7.02
7.27(a)-(b)
10.02
10.06, 10.22
16.01-16.02

108-109
141(a)
228
242
112-113
211
242
216
220

see also 16.20

1/19

Director and Officer Authority

Manson (skim), Molasky,
Drive In

1/21

Shareholder Control
Auer, Hall, Ramos

1/26

1/28

Close Corporations /
Oppression
Donahue, Kemp, Nixon
Capitalization
Toms, Hanewald

2/2

10

2/4

11

2/9

12

2/11

Leverage
Obre, Fett Roofing
Preemptive Rights; Buyouts
Katzowitz
Veil Piercing
Baatz, Walkovszky,
Sea-Land
Dividends
Klang, Kamin
Duty of Care
Francis, Caremark

349-350 (skim)
351-352 (ALI)
352-354 (skim)
356-368
370-371
381-390
395-398
435-440

8.03, 8.20-8.21
8.25(a), (d)-(e)
8.40, 8.41

141(b)-(c)
142

7.28
7.30 (skim)
7.31
8.04-8.06
8.08, 8.10

141(d), (k)
214, 218
223
242

398-408
412-426

7.32 (skim)
14.02

253-258
258-261 (skim)
261-265
265-269 (skim)
274-281
282-298

6.01
6.21(a)-(d)

341-342 (skim)
350-351 (skim)
355
151-154

6.30

102(b)(3)

445-455
455-458 (skim)
458-464
477-485
485-493 (skim)
493-502
503-525

6.22

102(b)(6)

6.31
6.40(a), (c), (d)
8.33
8.30(a)-(b)

160, 170
173-174
244

13

2/16

Business Judgment Rule

Joy v. North, Van Gorkom

525-546

8.30(c)-(e)

141(e)

14

2/18

546-561 +
Supplemental
Materials

3.02(13)
2.02(b)(4)

122(9)
102(b)(7)

15

2/23

565-586

8.60-8.63 (skim)

144

16

2/25

586-605

8.31 (skim)

17

3/8

Constituencies
Shlensky v. Wrigley
Exculpation
Arnold, Malpiede,
Cornerstone Therapeutics
(Supp.)
Duty of Loyalty
Lewis
Safe Harbors
Marciano, Benihana
Good Faith
Disney, Stone
Executive Pay

605-607
619-620
620-637

8.70

122(17)

11.05

253

11.01-11.04
12.01-12.02
13.02

251-252
262
271

18

3/10

Corporate Opportunities
Broz, Northeast Harbor
Controlling Shareholder Duties
Sinclair
Cash Out Mergers
Weinberger,
Kahn v. M&F (Supp.)
Appraisal /
Short-Form Mergers
Glassman
De Facto Mergers
Farris, Hariton
Takeover Defenses /
Intermediate Scrutiny
Cheff, Unocal, Revlon
Sale of Control
Time, QVC

640-644
652-662
[defer last & p. 663
to class 18]

+ Supplemental
Materials
662 [last ]-669
679-689
692-694

19

3/15

20

3/17

21

3/22

22

3/24

Deal Protection
Lyondell, Ace, Omnicare

748-771

8.26

23

3/29

773-792

7.42

24

3/31

Derivative Suits & Demand

Tooley, Aronson
Derivative Suits & SLCs
Auerbach, Zapata

792-807

7.44

25

4/5

Indemnification
Waltach, Heffernan

820-840

8.51-8.52 (skim)
2.02(b)(5)

26

4/7

Review and Questions

694-719

719-746

203 (skim)
146

145(a)-(c) & (e)-(g)