Are the directors liable? why or why not?

Instructional Objectives for this activity:
Interpret the legal factors involved in corporate management and ownership.

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As company ombudsman, your task is to investigate complaints of wrongdoing on the part of corporate directors and officers, decide whether there is a violation of the law, and deal with the wrongdoers accordingly. Jane, a shareholder of Goodly Corporation, alleges that its directors decided to invest heavily in the firm’s growth in negligent reliance on its officers’ faulty financial reports. This caused Goodly to borrow to meet its obligations, resulting in a drop in its stock price.

Are the directors liable? Why or why not?

This individual work should include the following:

  • An in-depth submission that should be free of spelling and grammar errors.
  • An essay containing a minimum of 200 words.
  • You will be assessed on the rationale you use in addressing the questions/issue posted, and how well you justify your argument regarding this issue.
  • Your response must be thought provoking, have well developed ideas and/or opinions, and should reference any supporting material from the text, lecture or other sources you have used to complete the assignment.

You may use your text or the internet as a reference, but remember to cite your sources according to APA guidelines.  For citation guidelines, please refer to the table in the APA Style section of the syllabus.

 

Reference

 

Hollowell, W.E. & Miller, R. L., (2014).  Business law text & exercises. (7th ed.) South-Western, Cengage Learning.

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