The Van Gorkom decision was viewed by many as the catalyst which triggered the dramatic increases in the number of shareholder suits filed, director and officer (hereinafter D & 0) insurance policy cancellations, skyrocketing premiums, and the flight of the outside directors.' Devastating decisions like Van Gorkom could be prevented or at least be of a lesser magnitude if corporate counsel chose to use the proactive approach to corporate representation by employing the techniques of preventive law. The theory is similar to the time honored cliché "an ounce of prevention is worth a pound of cure." This Article will address the Board of Directors' mission, including the various theories surrounding the duty of care, the effects of Van Gorkom, the legislative remedies enacted to counteract the effect of Van Gorkom and finally, the proactive approach of corporate client counseling.
Lynn A. Howell,
Post Smith v. Van Gorkom Director Liability Legislation with a Proactive Perspective,
36 Clev. St. L. Rev.
available at http://engagedscholarship.csuohio.edu/clevstlrev/vol36/iss4/14