Class action law enforcement is a resource-intensive undertaking, requiring investment of both intellectual capital and financial wherewithal. Building on insights developed in the economic theory of investment under uncertainty, the key theoretical proposition is that class action law...

Numerous principal-agent situations of interest to accounting involve limited liability by the agent. We explore this issue when the outcome is mutually observable (MOC) and when it is not and the contract is based instead on the agent's report (NCC). We find that when outcome is not observable,...

Limited liability has been known in Europe since at least the twelfth century, and appeared later in England and throughout the remainder of the developed world. Limited liability can be achieved by private contractual arrangements, by the use of limited liability forms of enterprise, by other...

What standards should the courts use to determine whether or not to certify the class proposed by the plaintiffs? The answer to this question has ramifications for many areas of the law in which class actions have become an oft-used method for pursuing claims against alleged wrongdoers,...

This paper studies the effect of limited liability on corporate architecture. Corporate architecture refers to the use of governance instruments within the firm to control the behavior of employees. Four general instruments are defined that form the basis of the firm as a governance arrangement....

Firms that do not have enough assets to cover potential tort liability have a reduced incentive to take safety precautions. Large firms can take advantage of this by compartmentalizing their most dangerous activities into smaller subsidiaries. Under current law it is difficult to reach the...

This article explores how issuer liability reallocates fraud risk and how risk allocation may reduce the incidence of fraud. In the US, the apparent absence of individual liability of officeholders and insufficient monitoring by insurers undermines the potential deterrent effect of securities...

International law is not known for being quick or effective. Cases can drag on for years, have limited legal force, and are infamous for noncompliance. Until recently, the World Trade Organization (WTO) dispute settlement process had served as a beacon of hope for being one of the fastest and...

Delaware precedent, primarily Trados and ODN, holds that corporate boards of directors owe fiduciary duties to holders of corporation common stock and not to holders of preferred stock. This precedent, however, fails to address a broad range of complex but commonly occurring potential conflicts...