Fact Pattern from Part I of the Assignment – Relevant Facts
You and two friends incorporated a company that offers a B2B (business-to-business) platform to help farmers in Delaware, California, and New Jersey transport their goods to restaurants operating in the farm-to-table space.
Your business is a sort of Uber for Delaware chicken, California asparagus, and New Jersey blueberries.
Fact Pattern – Part II of the Assignment
Assume that a couple of years have gone by and that your B2B (business-to-business) farm-to-table company is a great success.
The company owns a fleet of 250 trucks. It also outsources to independent truck drivers, using an Uber-style business model.
The company operates in the 48 states in the continental United States.
The company went public last year in an IPO and it is currently traded on the New York Stock Exchange.
For Part II of the Assignment we will assume that the company is called Farm-to-Table Trucking, Inc. and that it was duly incorporated in Delaware.
Note: companies that are incorporated in other states will often re-incorporate in Delaware before doing an IPO. Among other things, Delaware has well-developed case law that is of particular relevance to publicly traded companies.
Transportation of fresh fruits, vegetables, and chicken creates a number of food safety risks.
You are currently the Chief Operations and Compliance Officer for Farm-to-Table Trucking.
Questions
The board of directors has asked you to prepare a 5 page memorandum describing:
The steps that the board of directors should take in order to ensure that it meets its fiduciary duties to adopt appropriate compliance policies and procedures, in connection with ensuring food safety.
In providing this guidance, the board has asked you to read the following materials
Marchand v. Barnhill, 698 A. 2d 959 (Del. Ch. 2019)
pp. 807-815 and 820-824 (Section B. The Caremark Claim)
Lineage Logistic Holding, LLC, Ethics and Compliance at Lineage â Excerpt
Nissa Ackerley, et al, Food Transportation Safety: Characterizing Risks and Controls by Use of Expert Opinion, 30 Food Protection Trends 212-222 (2010)
Introduction – pp. 212-214
Results – pp 215-217
The risks of criminal liability – to the company, board members, and top executives – due to failures in the company\’s food safety policies and procedures.
In providing this guidance, the board has asked you to read the following materials
Press Release, Depât of Justice, Blue Bell Creameries Ordered To Pay $17.25 Million In Criminal Penalties In Connection With 2015 Listeria Contamination (Sep. 17 2020) (Note: this is the same company in the Marchand v. Barnhill case.)
Memorandum, Depât of Justice, Further Revisions to Corporate Criminal Enforcement Policies Following Discussions with Corporate Crime Advisory Group (September 15, 2022)
Part II. Section D. Evaluation of a Corporation\’s Compliance Program, pp. 9-11
Fact Pattern from Part I of the Assignment – Relevant Facts You and two friends
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