Responsibilities of Corporate Directors and Officers

Boards of directors and officers of corporations have distinct functions. Generally, directors set corporate policy while officers carry out that policy.

Public Comment and Judicial Review Regarding Government Antitrust Settlements

Under Section 5(a) of the Clayton Act, 15 U.S.C.S. § 16(a), a final judgment in a successful federal government antitrust enforcement action is prima facie evidence in a subsequent private action for treble damages of the defendant's antitrust violation. However, a consent decree agreed to by a defendant in a federal government action before any testimony is taken is not considered prima facie evidence in a subsequent private action.

Limitations on Margin Trading

Limitations on Margin Trading

Corporate Criminal Liability

Corporations were not initially held criminally responsible for corporate activities. A corporation was considered to be a legally fictitious entity, incapable of forming the mens rea necessary to commit a criminal act. The Supreme Court ultimately rejected this notion in 1909 in New York Central & Hudson River Railroad v. U.S. A railroad company employee paid rebates to shippers in violation of federal law. The court upheld the corporation's criminal conviction, finding no reason that corporations could not be held "responsible for and charged with the knowledge and purposes of their agents, acting within the authority conferred upon them." The Supreme Court concluded that criminal liability could be imputed to the corporation based on the benefit it received as a result of the criminal acts of its agents. The case and its progeny have essentially imported the doctrine of respondeat superior from tort law into the corporate criminal realm. A corporation may be convicted for its agent's unlawful acts when the agent acted within the scope of his or her actual or apparent authority. Another theory of corporate criminal liability is the "collective knowledge doctrine." As knowledge of criminal activity is often the scienter element of a particular crime, the requisite knowledge can be imputed to the corporation based on the collective knowledge of the directors and officers.

Closed-End Funds

The three basic types of investment companies regulated under the Investment Company Act of 1940 are closed-end funds, mutual funds, and unit investment trusts. Closed-end funds must be registered with the Securities and Exchange Commission. Such funds are regulated under the Investment Company Act of 1940 and are subject to the Securities Act of 1933 and the Securities Exchange Act of 1934. Regulations have been issued by the Securities and Exchange Commission to govern the operation of closed-end funds.