John Austin and H.L.A. Hart are two of the most renowned figures in English jurisprudence. Austin formulated his version of legal positivism in his lectures at University College London in the early 1830s. Hart began developing a more sophisticated version of positivism around the time he was appointed as Oxford’s Professor of Jurisprudence in the early 1950s. But what happened to English jurisprudence during the many years that separated Austin and Hart? This Article examines the predicament of English jurisprudence during those years. It is shown that although various efforts were made to move English jurisprudence beyond Austin, the subject remained unimaginative and basically moribund. The Article then considers why, at a time when the American law schools were developing new conceptual and theoretical approaches to law, English jurists should have been incapable of jurisprudential innovation. Indifference and even hostility toward jurisprudence on the part of black-letter lawyers, and a general English tendency to denigrate theory and undervalue systematization, have sometimes been put forward as explanations for the failure of jurisprudence to develop as a discipline during the period separating Austin and Hart. It is argued in this Article that, while those explanations should not be dismissed, jurisprudence was slow to develop because law barely existed as an academic discipline in England during this period, and because, when the English law faculties did begin to emerge, they were generally not suited to the encouragement of serious jurisprudential inquiry.
Lawrence Lessig’s Dystopian Vision
In Free Culture, Stanford Law School Professor Lawrence Lessig has ratcheted up his already heated rhetoric to produce a book that warns that the health of the “ecosystem of creativity” is in “grave peril” due to the efforts of “big cultural monopolists” to reduce the size of the public domain while using new technologies “to control what we can and can’t do with the culture all around us.” Failure to reverse the degradation of this ecosystem, we are assured, could lead to the loss of “freedom to create, freedom to build” and even “freedom to imagine.”
But the curious thing about Free Culture is that, stripped of its impassioned tone, the book portrays not a world of suffocated creativity and cultural impoverishment, but rather one where an unprecedented number of individuals are engaged in creative projects, free to make use of and draw inspiration from a rich trove of cultural resources. To be sure, the picture that emerges is far from a Panglossian “best of all possible worlds.” Real problems exist, and Lessig provides a valuable public service in pointing them out. Absent from Lessig’s analysis, though, is a full acknowledgement that the problems he details are of a piece with ones that Anglo-American law has confronted many times. In particular, the concern that special interests will pressure legislatures to change the contours of property rights so as to restrict competition was well understood by the nation’s founders, and the drawbacks of granting property rights to individuals and institutions who place little or no value on such rights (as may have occurred with the abolition of formal registration requirements to obtain copyrights) have been extensively discussed in the contexts of adverse possession and future interests.
Lessig’s stubborn insistence that the dangers that loom are of unprecedented magnitude leads him to suggest that sweeping overhauls of legal rules and institutions as well as of societal norms are warranted. But a careful reading of Lessig’s own litany points to a different, more complicated conclusion: existing regimes are for the most part healthy, albeit in need of continual monitoring and adjustment.
Toward a Controlling Shareholder Safe Harbor
This Note surveys the law governing transactions between public corporations and their controlling shareholders. It explains that Delaware courts review these “controlling shareholder transactions” under the “entire fairness” standard. Yet, Delaware and the Model Act provide safe harbors to review independently approved transactions between corporations and their directors under the business judgment rule. This Note questions the disparate treatment and suggests that the same constraints on interested directors—namely, disinterested approval and market checks—are at least as effective in supervising controlling shareholders.
Next, this Note proposes that a safe harbor doctrine extend to controlling shareholder transactions. The premise is that, so long as the interests of controlling and minority shareholders are aligned, independent approval and market checks together provide sufficient constraints that challenge the utility of the current entire fairness rule. Yet, because these constraints fail when shareholder interests diverge in the so-called “final period,” this Note suggests that controlling shareholder transactions be separated into (1) final period and (2) non-final period categories. Business judgment is appropriate when shareholder interests are aligned, but entire fairness is necessary in the final period to protect the minority from the controlling shareholder’s self interest.
This argument relies on two principal Delaware cases: Puma v. Marriott (1971) and Kahn v. Lynch Communications (1994). It suggests that Lynch implicitly recognized the final period problem, while Puma declined judicial review because the aggregate interests of shareholders were aligned. Thus, read together, they are seen as wholly consistent with the theory underlying a controlling shareholder safe harbor.