Regular readers know that I have been a long-time critic of the American law Institute's Principles of Corporate Governance and, more recently, a critic of the ALI's effort to again tackle a restatement of the Law of Corporate Governance.
My blog posts on the topic are collected here. And then there are my law review articles:
Bainbridge, Stephen Mark, Do We Need a Restatement of the Law of Corporate Governance? (July 7, 2022). UCLA School of Law, Law-Econ Research Paper No. 22-06, Available at SSRN: https://ssrn.com/abstract=4156924
Bainbridge, Stephen Mark, A Critique of the American Law Institute’s Draft Restatement of the Corporate Objective (August 4, 2022). UCLA School of Law, Law-Econ Research Paper No. 07, 2022, Available at SSRN: https://ssrn.com/abstract=4181921
So naturally I was interested in a blog post from Edward Robson-a Pennsylvania practitioner-on the impact of the ALI Principles on Pennsylvania law:
I have never had particularly strong feelings about the ALI Principles themselves, but their application in Pennsylvania to cases dealing with closely-held companies has been, at best, unhelpful.
Although our Supreme Court gave them a hearty endorsement shortly after their creation, most Pennsylvania courts (including that same Supreme Court) since then have found them to be inconsistent with Pennsylvania law.
...
The result is the legal equivalent of scrapple (for those not from Pennsylvania, this will help you digest the metaphor: https://en.wikipedia.org/wiki/Scrapple)—likely to lead to procedural wrangling and litigation sideshows that make it frustrating for counsel plotting a course though business divorce litigation.
Go read the whole thing.
