Florida Senator Marco Rubio Pushing Bill To Give Shareholders Additional Authority To Challenge So-Called “Woke” Corporations
According to a report from Florida Daily, Florida Senator Marco Rubio recently introduced legislation called the “Mind Your Own Business Act” that proposed new legal tools to shareholders who want to challenge so-called “woke” corporations. In this blog post, our West Palm Beach shareholder dispute lawyers discuss the proposed legislation from Senator Marco Rubio.
Proposed Legislation Introduced By Senator Rubio: The Mind Your Own Business Act
As described by Senator Rubio, a “woke” corporation is one that is engaged in some form of social activism. In this specific context, the term is usually meant to refer diversely to progressive-leaning politics. The proposed legislative reform from Senator Rubio would give individual shareholders additional legal tools to challenge corporations to prove that their practices are good for business. Here are three things to know about the Mind Your Own Business Act as currently drafted:
- Shareholders Could Bring a Breach of Fiduciary Duty Claim for “Woke” Corporate Action: Senator’s Rubio’s bill would dramatically expand fiduciary duty requirements for corporate officers and directors. In effect, it would allow shareholders to sue the corporation itself for certain “social” activity if they feel that the activity is not in the best financial interest of the company.
- The Bill Would Apply to Large Companies On National Stock Exchanges: The Mind Your Own Business Act does not apply to every corporation. Instead, the legislation is reserved for large corporations that are listed on national stock exchanges, such as the New York Stock Exchange or the NASDAQ Composite.
- The Burden of Proof Would Be On Management: Notably, if passed into law, Senator Rubio’s bill would shift the burden of proof to management in certain shareholder dispute cases. When a lawsuit is filed for a breach of fiduciary duty on this bill, the management of the corporation would have a duty to prove that they acted in the best financial interests of the company.
The Bill is Unlikely to Become Law in Its Current Form
While it has drawn a lot of headlines and brought attention to the issue of shareholders rights, the Mind Your Own Business Act is highly unlikely to make much legislative progress, at least in its current form. To start, all three branches of the federal government are controlled by the Democratic party—though they have very narrow majorities, especially in the Senate. Further, some business interest groups have openly criticized the bill on the grounds that it would undermine the ability of corporate officers and corporate directors to manage their companies in the manner that they see fit.
Get Help From a Shareholder Rights Attorney in South Florida
At Pike & Lustig, LLP, our Florida shareholder lawyers are diligent, solutions-centered advocates for clients. With deep experience navigating legal claims, we handle the complete spectrum of shareholder disputes. Call our law firm now for a fully confidential review and assessment of your case. From our legal offices in Miami and West Palm Beach, we provide shareholder representation throughout the area, including in Jupiter, Fort Lauderdale, Deerfield Beach, and Hialeah.