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Rethinking Delaware's Corporate Opportunity Doctrine

16 Pages Posted: 9 Nov 2008  

Stephen M. Bainbridge

University of California, Los Angeles (UCLA) - School of Law

Date Written: November 6, 2008

Abstract

Although the prohibition on taking of organizational opportunities is well established, the standards applied to this problem in corporate law disputes are vague and imprecise. Corporate directors and officers lack clear guidance as to when a particular business venture may be taken for themselves or must first be offered to the corporation. In this article, I review the relevant Delaware case law, focusing on the ambiguities inherent therein. I then offer a proposed alternative regime, providing greater certainty and predictability.

Keywords: corporate opportunity doctrine, fiduciary duties, directors, officers

JEL Classification: K22

Suggested Citation

Bainbridge, Stephen M., Rethinking Delaware's Corporate Opportunity Doctrine (November 6, 2008). UCLA School of Law, Law-Econ Research Paper No. 08-17. Available at SSRN: https://ssrn.com/abstract=1296962 or http://dx.doi.org/10.2139/ssrn.1296962

Stephen Mark Bainbridge (Contact Author)

University of California, Los Angeles (UCLA) - School of Law ( email )

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