New Orleans Paddlewheels, Inc. (NOP), is a Louisiana corporation formed in 1982 when James Smith, Sr., and
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NOP and the other companies, literally changing the locks on the doors. At the next meetings of the boards of NOP and the overall enterprise, deadlock ensued, with the directors voting along family lines on every issue. Complaining that the meetings were a “waste of time,” JES began to run the entire enterprise by taking advantage of an unequal balance of power on the companies’ executive committees. In NOP’s subsequent bankruptcy proceeding, Reuther filed a motion for the appointment of a trustee to formulate a plan for the firm’s reorganization, alleging, among other things, misconduct by NOP’s management.
(a) Was Reuther legally entitled to have access to the books and records of NOP and the other companies? JES maintained, among other things, that NOP’s books were “a mess.”Was JES’s denial of that access unethical? Explain.
(b) How would you describe JES’s attempt to gain control of NOP and the other companies? Were his actions duplicitous and self-serving in the pursuit of personal gain or legitimate and reasonable in the pursuit of a business goal? Discuss.
Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...
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Related Book For
Business Law Text and Cases
ISBN: 978-0324655223
11th Edition
Authors: Kenneth W. Clarkson, Roger LeRoy Miller, Gaylord A. Jentz, F
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