Should Courts Do Behavioral Analysis of Boardroom Conduct?

Journal of Business & Technology Law, Vol. 9, No. 1, 2014

Ohio State Public Law Working Paper No. 233

9 Pages Posted: 12 Feb 2014

See all articles by Dale A. Oesterle

Dale A. Oesterle

Ohio State University (OSU) - Michael E. Moritz College of Law

Date Written: February 11, 2014

Abstract

A stunning collapse of judgment by a board of directors of able professionals in an acquisition led a Vice Chancellor of the Delaware Chancery Court to expound on "cognitive bias" in group decisions. At issue is whether modern behavioral analysis of group decision making should be part of a court’s analysis of the fiduciary duty of a board of directors. The author, after consideration, rejects a robust application of behavioral analysis in court evaluations but does support a limited role for the reasoning.

Keywords: Boards of Directors, Cognitive Bias

JEL Classification: K2, K20, K22, K29

Suggested Citation

Oesterle, Dale A., Should Courts Do Behavioral Analysis of Boardroom Conduct? (February 11, 2014). Journal of Business & Technology Law, Vol. 9, No. 1, 2014; Ohio State Public Law Working Paper No. 233. Available at SSRN: https://ssrn.com/abstract=2394154 or http://dx.doi.org/10.2139/ssrn.2394154

Dale A. Oesterle (Contact Author)

Ohio State University (OSU) - Michael E. Moritz College of Law ( email )

55 West 12th Avenue
Columbus, OH 43210
United States

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