4 ms·

Presumably when you bought the shares you paid for that specific arrangement. If you don't like the share structure buy another company, or pay less for it.

rmrfstar 6y ago
Governments are not obligated to lend their coercive power to enforce all agreements, particularly ones that lead to bad outcomes. See, e.g. Sherman Act. See also, bans on organ sales and indentured servitude. It is perfectly legitimate to say "this is a kind of agreement that should be enforced by the state." It is quite another thing to say (as you have), "a transaction happened in the market so this is legitimate." Limited liability did not exist as a legal concept in the United States until 1811. It is really strange that people now seem to view limited liability legal forms as an unqualified right, whose scope and governance can be defined by private contract without constraint.
- justinmeiners 6y ago
  Yes, but this is far out of the context of this discussion. This topic has nothing to do with entering into an absurd unenforceable contract. Investments offer different terms to different customers. Those with fewer privileges are worth less, and you should be willing to pay less or not at all. This is not employment, or personal housing, this is a purchase purely for future financial gain, for which markets offer countless alternative offerings. Basketball teams sell different tickets and offerings, some are restricted to specific customers. You pay for the level of experience you want.
  - rmrfstar 6y ago
    > Yes, but this is far out of the context of this discussion Facebook's multi-class-voting share structure is an artifact of Delaware corporate law. The DGCL changes all the time. The fact that some group of investors agreed to that structure in 2012 does not mean that Delaware is obligated to lend its coercive power to enforce it in perpetuity. In fact, Delaware is under increasing pressure to void such arrangements by amending its corporate law [1]. [1] https://corpgov.law.harvard.edu/2019/09/24/letter-to-delaware-state-bar-association-limiting-multi-class-voting-structures/ https://corpgov.law.harvard.edu/2019/09/24/letter-to-delawar...
    - justinmeiners 6y ago
      I did not know this particular policy was under scrutiny. Could this be handled at the exchange level? Can they set voting requirements for the kinds of stocks they will make available? Is there an SEC angle to this as well in how they classify public companies? It just seems very weird to me that a particular business arrangement which is well-understood and non-predatory would need to be outlawed.
      - rmrfstar 6y ago
        "Need to be outlawed" and "government does not enforce" are different things. Example 1: California will not enforce non-compete covenants. What it means to enforce such covenants is that company A can have police physically prevent you from working for company B if company A requests such intervention. Refusing to grant that privilege to company A is not outlawing anything. Example 2: There is a 300 year old legal doctrine called "the rule against perpetuities" whose history and rationale may answer some of your questions. [1] [1] https://en.wikipedia.org/wiki/Rule_against_perpetuities https://en.wikipedia.org/wiki/Rule_against_perpetuities

rmrfstar 6y ago

Governments are not obligated to lend their coercive power to enforce all agreements, particularly ones that lead to bad outcomes. See, e.g. Sherman Act. See also, bans on organ sales and indentured servitude. It is perfectly legitimate to say "this is a kind of agreement that should be enforced by the state." It is quite another thing to say (as you have), "a transaction happened in the market so this is legitimate." Limited liability did not exist as a legal concept in the United States until 1811. It is really strange that people now seem to view limited liability legal forms as an unqualified right, whose scope and governance can be defined by private contract without constraint.

justinmeiners 6y ago
Yes, but this is far out of the context of this discussion. This topic has nothing to do with entering into an absurd unenforceable contract. Investments offer different terms to different customers. Those with fewer privileges are worth less, and you should be willing to pay less or not at all. This is not employment, or personal housing, this is a purchase purely for future financial gain, for which markets offer countless alternative offerings. Basketball teams sell different tickets and offerings, some are restricted to specific customers. You pay for the level of experience you want.
- rmrfstar 6y ago
  > Yes, but this is far out of the context of this discussion Facebook's multi-class-voting share structure is an artifact of Delaware corporate law. The DGCL changes all the time. The fact that some group of investors agreed to that structure in 2012 does not mean that Delaware is obligated to lend its coercive power to enforce it in perpetuity. In fact, Delaware is under increasing pressure to void such arrangements by amending its corporate law [1]. [1] https://corpgov.law.harvard.edu/2019/09/24/letter-to-delaware-state-bar-association-limiting-multi-class-voting-structures/ https://corpgov.law.harvard.edu/2019/09/24/letter-to-delawar...
  - justinmeiners 6y ago
    I did not know this particular policy was under scrutiny. Could this be handled at the exchange level? Can they set voting requirements for the kinds of stocks they will make available? Is there an SEC angle to this as well in how they classify public companies? It just seems very weird to me that a particular business arrangement which is well-understood and non-predatory would need to be outlawed.
    - rmrfstar 6y ago
      "Need to be outlawed" and "government does not enforce" are different things. Example 1: California will not enforce non-compete covenants. What it means to enforce such covenants is that company A can have police physically prevent you from working for company B if company A requests such intervention. Refusing to grant that privilege to company A is not outlawing anything. Example 2: There is a 300 year old legal doctrine called "the rule against perpetuities" whose history and rationale may answer some of your questions. [1] [1] https://en.wikipedia.org/wiki/Rule_against_perpetuities https://en.wikipedia.org/wiki/Rule_against_perpetuities