Scenario #1

The board of directors for ABC Corporation took out a $30 million dollar loan to invest in capital expenses. After the company received the loan, the board voted to spend all the money on lobbying efforts in state and national legislatures. During that time, the company reported a $50 million dollar decrease in worth. Disgruntled, the company shareholders sue the board for the devaluation of the company and their stock.

Scenario #2

In December 2020, the Federal Trade Commission (FTC) and 46 states sued Facebook, alleging Facebook violated antitrust laws by buying competitors to eliminate competition in the social media industry.

Topic Questions:

1. Regarding the first scenario:
   • What type of lawsuit should the shareholders bring?
   • What defense(s) should the board raise?
   • Who will likely be successful in the lawsuit, and why?
2. Regarding the second scenario:
   • If you were representing the FTC, what is the strongest legal argument that Facebook is violating antitrust laws. (be specific about what laws are being violated.)
   • If you were representing Facebook, what is the strongest legal argument that you are not violating antitrust laws. (be specific about what laws are involved.)

Reflection Questions:

1. Is there anything you learned that will cause you to change your behavior from what it was before working on this module? What is it? Please discuss.
2. Which topics were confusing, complicated or contradictory? Why?