An Act To Amend the Maine Business Corporation Act
Maine Legislature, Session 121, LD 1136
Committee: Judiciary
Sponsors: EDER, CANAVAN, CRAVEN, DUDLEY, PINGREE, TWOMEY, WALCOTT
Amends: 13-C MRSA §106, 13-C MRSA §831

Legislative Document 
No. 1136 
H.P.839 
House of Representatives, March 4,2003 
An Act To Amend the Maine Business Corporation Act 
Reference to the Committee on Judiciary suggested and ordered printed. 
Presented by Representative EDER of Portland. 
1Jj~ 
1J1.7IldC~ 
MILLICENT M. MacFARLAND 
Clerk 
Cosponsored by Representatives: CANAVAN of Waterville, CRAVEN of Lewiston, 
DUDLEY of Portland, PINGREE of North Haven, TWOMEY of Biddeford, WALCOTT of 
Lewiston. 
Printed on recycled paper 
Be it enacted by the People of the State of Maine as follows: 
Sec. 1. 13-C MRSA §106 is enacted to read: 
§l06. 
Safeguard public interest; damages 
1, 
Sue for damages. 
A person may sue a corgoration or a 
director 
of 
a 
corporation 
for 
damages 
suffered if 
in 
the 
operation of the corporation the corporation adversely affects 
the public interest. 
As used in this section, "public interest" 
means the environment, human rights, public health and safety of 
the community in which the corporation operates and the dignity 
of the corporation's employees. 
Suit may be brought at law or in eguity in a court of competent 
jurisdiction against 
the 
corporation 
or 
a 
director 
of 
the 
corporation at the time the damage occurred or at the time the 
board of directors of the corporation approved the action that 
caused the damage. 
2. 
Exemption. 
Notwithstanding any other provision of this 
chapter t 
a director of a corporation is not liable for damages 
pursuant to subsection 1 if the director can prove that: 
A. 
The damage complained of was the direct result of an 
action that was 
approved 
by 
the corporation's board of 
directors but that the director had voted against; or 
B. 
The damage complained of was the direct result of an 
action approved by the corporation prior to the director's 
becoming a member of the board. 
This subsection does not apply to a corporation or a director of 
a 
corporation if 
the 
consolidated 
annual 
revenues 
of 
that 
corporation are less than $15,000,000. 
3. 
Damages; amount; punitive. 
The court may award damages 
against the corporation or director of the corporation for 
a 
violation of the public interest if the plaintiff has established 
clear and convincing evidence that the corporation or director 
knowingly, 
intentionally or 
recklessly 
caused 
damage 
to 
the 
public interest or injury to the plaintiff. 
A plaintiff in a court of law who successfully sues a corporation 
or director of a corporation pursuant to subsection 1 may recover 
damages in one of the following amounts, whichever is greater: 
A. 
The actual damage caused to the plaintiff: or 
Page l-LR0698(l) 
.. 
• 
.. 
• 
• 
• 
• 
B. 
Three times the savings realized by the corporation as a 
result of the corporation's or 
a 
director's failure 
to 
protect the public interest pursuant to subsection 1. 
4. 
Contribution. 
A director of a corporation against whom 
a suit has been brought pursuant to subsection 1 and who is found 
liable is entitled to contributions from every other director of 
that corporation who could be held liable under subsection 3 or 
any other director who, 
if sued separately, 
would have been 
liable to make the same payment. 
5. 
Statute 
of 
limitations. 
An 
action 
pursuant 
to 
subsection 1 must begin within 2 years after the discovery of the 
damage caused. 
An action pursuant to subsection 1 must begin 
within 6 years after the time the damage occurred. 
An action may 
not be brought to enforce any liability under subsection 1 that 
accrues prior to January 1, 2017. 
6. 
Controlling person; liability. 
A person who, 
through 
stock ownership, agency or otherwise, or who, under an agreement 
with one or more other persons through stock ownership, agency or 
otherwise, controls a person liable under subsection 1 is also 
jointly and severally liable to the same extent as the controlled 
person, 
unless the controlling person had no 
knowledge of or 
reasonable grounds to believe in the existence of the facts by 
reason of which the controlled person is liable. 
For purposes of this subsection, the term "control." including 
the terms "controls," "controlled" and "controlling," means the 
possession, direct or indirect, of the power to direct or cause 
the direction of the management and policies of a person, whether 
through stock ownership, agency or otherwise, 
7. 
Attorney general; bring action. 
Whenever it appears to 
the 
Attorney 
General 
that 
a 
corporation 
or 
director 
of 
a 
corporation is engaged or about to engage in an act or practice 
that constitutes or will constitute a violation of the provisions 
of 
subsection 
1, 
the 
Attorney 
General 
may 
in 
the 
Attorney 
General's discretion bring an action in an appropriate court to 
enjoin 
such act or 
practice 
and, 
upon 
a 
proper 
showing, 
a 
permanent or temporary injunction or restraining order may be 
granted without bond . 
Whenever it appears to the Attorney General that a corporation or 
director 
of 
a 
corporation 
has 
violated 
the 
prov~s~ons 
of 
subsection 1, the Attorney General may bring an action in court, 
and the court has jurisdiction to impose, upon a proper showing, 
a civil penalty on the corporation or director who committed the 
violation. 
The penalty is payable to the State. 
This subsection takes effect January 1, 2017. 
8. 
Criminal penalties. 
A director of a corporation who 
willfully violates subsection 1 shall upon conviction be fined 
not more than $1,000,000 or imprisoned not more than 5 years, or 
both. 
The fine may not reduce the amount of a civil,penalty paid 
under subsection 7. 
9. 
Attorney's 
fees. 
Upon 
motion, 
a 
court 
may 
award 
attorney's 
fees 
to 
a 
successful party against 
one 
or 
more 
defendants in any action pursuant to subsection 1 against a 
corporation or a director of a corporation if: 
A. 
The action results in a significant benefit. whether 
pecuniary or nonpecuniary, to the general public or a large 
class of persons other than shareholders; and 
B. 
The court determines that the fees should not in the 
interest of justice be paid out of recovery, if any. 
Sec. 2. 13-C MRSA §831, sub-§l, 1fB, as enacted by PL 2001, c. 
640, Pt. A, §2 and affected by Pt. B, §7, is repealed and the 
following enacted in its place: 
B. 
In a manner that: 
(1) The director reasonably believes to be in the best 
interests of the corporation; or 
(2) 
Does not adversely affect the public interest. 
"Public interest" means the environment. human rights, 
public health and safety of the community in which the 
corporation 
operates 
and 
the 
dignity 
of 
the 
corporation's employees. 
Sec. 3. 13-C MRS A §843, sub-§l, ,C, as enacted by PL 2001, c. 
640, Pt. A, 
§2 and affected by Pt. B, §7, is repealed and the 
following enacted in its place: 
C. 
In a manner that: 
(1) 
The officer reasonably believes to be in the best 
interests of the corporation; or 
(2) 
Does not adversely affect the public interest. 
"Public interest" means the environment. human rights, 
public health and safety of the community in which the 
corporation 
operates 
and 
the 
dignity 
of 
the 
corporation's employees. 
• 
• 
• 
• 
• 
• 
• 
.. 
SUMMARY 
This bill amends 
the Maine 
Business Corporation 
including as part of the duties of directors the duty to 
the 
corporation in 
a 
manner 
that fully respects 
the 
interest. 
Act 
by 
operate 
public 
The bill provides that, after January 1, 2017, actions may 
be brought against not only the corporation, 
but individual 
directors for activities of the corporation that adversely affect 
the 
environment, 
human 
rights, 
public health 
and 
safety or 
dignity of corporate employees.