LAW 401 SEU Companies Law Case Study

1. Case StudyYou are the Chairman of the Board of a well-known, publicly traded corporation. You
are personally responsible for convincing the Board to fund a new product design that
ultimately failed when it was placed on the market, causing extreme losses for the
corporation. The shareholders now want to hold you personally responsible for all the
losses to the corporation and have filed a derivative lawsuit in the name of the
corporation in which you are the defendant. Please describe how you would defend
yourself using the Business Judgment Rule. Create and describe any facts you think
will support your position under this Rule. Limit your facts to only those that will
support your position under this Rule and no others.
Action Items
1. Read the case study above.
2. By the due date, submit your answers to the case study questions. Justify your
answers.